Analyzing a Simulation Model for Disaster Relief Supply Chain: a Case Study

Over the last three decades, natural or man-made disasters globally claimed more than 3 million lives, caused tremendously property damages and losses, and adversely affected at least 1 billion people’s lives. To better... [ view full abstract ]

Over the last three decades, natural or man-made disasters globally claimed more than 3 million lives, caused tremendously property damages and losses, and adversely affected at least 1 billion people’s lives. To better prepare for disasters, reduce casualties, and alleviate the disastrous victim sufferings, we need a better disaster relief supply chain that can help emergency management planners make better disaster related decisions. In this study, we design and develop a simulation model of two-stage disaster relief supply chain, which includes regional warehouse stage and Point of Distribution (POD) stage. This two-stage supply chain design is compared to the FEMA’s supply chain structure, which includes five stages: Point of Distribution (POD), State Staging Area (SSA), Federal Operations Staging Area (FOSA), a Mobilization Center (MOB) and Logistic Centers. For both supply chain structures, continuous review inventory policy and cross-docking policy are used to manage the relief inventories. The main performance measures include demand coverage rate, total inventory costs, deprivation costs, transportation costs, inventory level, and backorder level. The developed simulation model is evaluated and validated through a case study applied to an imaginary hurricane/flood disaster in South Carolina, but the model can be generalized to cope with other types of disaster events. Based on the case study, sensitivity analyses is conducted to identify the most critical input factors. The computational results illustrate the impact of increased demand and inventory pre-position on the main performance measures. The paper is concluded by a summary of lessons learned from the model based on the case study.